Fashion retailer New Look is preparing to accelerate store closures as a result of Labour’s tax-raising budget, while “Chicken King” Ranjit Boparan battles to pass higher costs on to supermarkets—signalling further pressure on UK businesses across multiple sectors.
Around a quarter of New Look’s 364 British outlets are understood to be at risk of closure when leases expire, potentially placing hundreds of jobs in jeopardy out of a workforce of approximately 8,000. Though some closures were inevitable, the pace of consolidation has reportedly quickened following the budget’s announcement in October.
From April, the main rate of employers’ national insurance contributions (NICs) will rise to 15 per cent from 13.8 per cent, with the threshold dropping from £9,100 to £5,000. The retail sector also faces a 6.7 per cent increase to the minimum wage, bringing it to £12.21 an hour, plus an additional £140 million in business rates from the same date. These measures have forced companies such as New Look to re-evaluate store portfolios and cut back on high street operations in an attempt to preserve profits.
The same cost pressures are expected to fuel food inflation. Boparan’s 2 Sisters Food Group, Britain’s largest chicken producer, employs 13,000 staff and processes six million chickens a week. Rising employment costs could add at least £30 million to its annual cost base, prompting the company to push supermarkets to pay more. Some industry insiders believe shoppers will see higher shelf prices within weeks, as many suppliers lock in annual pricing early in the year.
Analysts warn that other retailers are likely to follow New Look’s path unless landlords offer substantial rent concessions. According to the Centre for Retail Research, as many as 17,350 shops could close this year—up from 13,500 in 2024—demonstrating the growing strain on the high street.
A New Look spokesperson stated: “Our store estate is an important part of our business, alongside our website and app. We do occasionally close sites due to viability or at landlords’ request. However, we continue to invest in our remaining stores while remaining alert to potential new locations.”
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New Look speeds up store closures as budget fallout bites